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It’s a while since I wrote about Atlantic Canada.  So I hope you will be gentle with me as I try (for the first time) to write with one finger a LFL on my iPad.  Fran and I left Scotland on American Independence Day on the latest leg of our Recession Searching World Tour.  Having so far this year visited the wineries of Western and Southern Australia, the cities of Perth, Adelaide and Melbourne, more than a few airports, the hinterland of Ibiza and still no recession in sight.  Did I forget to mention wineries?  One does wonder where economists are hanging out these days.  Or do they never leave their spreadsheets and theories behind and venture out into the real world?

So let’s try Canada we thought.  What with Trump’s tariff threats and talk of “global slowdown” there’s bound to be some signs of misery over there, especially in the poorer Eastern provinces.  It’s also been a couple of years since we visited Nova Scotia’s stunning South Shore and a good 10 years since we dropped in on Newfoundland (long term clients may recall we owned a holiday home in Chester NS so it’s nice to pop back from time to time).

A question that I find helps investors to a fresh perspective when looking at stuff like economic or investment prospects is “What do you believe to be true that’s actually false?”  A great example is what you believe about Nova Scotia.  People used to ask me what we bought a holiday home “away up there for?” and “so far away?”  Thing is that from Glasgow you fly down to Nova Scotia.  Yes really.  Go check.  Halifax NS is on the same line of latitude as Toulouse and Turin, which may explain why this summer as usual is a cracker. 25C + thank you very much.

As to the winters, as Eli, rather more elderly than I but still up at 6am to open his coffee house, a favourite of Judi Dench when appearing in the Film “The Shipping News” in nearby Lunenburg, confirms they’re far less cold than you’d imagine thanks to the Gulf Stream that passes by from the Carolinas on its way to the UK.

The direct flight from Glasgow to Halifax is only 6 hours, with the return taking typically an hour less thanks to a helpful jet stream.  There were no signs of recession at Glasgow Airport.  Not a spare seat to be had on the plane.  All the more to enjoy the safety demonstration which was highly amusing for a change.  Best example was the announcement that if the cabin air supply failed oxygen masks and clean underwear would fall from the panel above our heads.  A positive for pessimists too.  Halifax Airport was busy, busy.  We spent a few hours there before boarding another jam-packed flight to Newfoundland.  So full that off-duty aircrew were jettisoned in favour of passengers, or sat on a plank in the cockpit.  Serves them right.

Did you know that Newfoundland is 25% bigger than Scotland with only 10% of the population?  
St John’s (the capital) has a population of around 110,000 and has a suburb called Paradise which is the fastest growing “town” in Canada.  On a drive down the scenic coast from St John’s which took us past Paradise, you had to wonder what early settlers got up to in these parts, as we passed Cupids, Conception Bay as well as one that I better not repeat as it may not get past your spam filter!  As to recession, like icebergs we failed to spot any.  Plenty of cranes and new buildings in construction but no sightings of economists.  Good sign.

And then on to Nova Scotia a 2 hour flight away.  It’s half the size of Newfoundland but has twice the population, still under 1 million lucky people.  Much photographed Mahone Bay is an easy hour’s drive from the airport.  It’s a drop dead gorgeous wee town that bursts to the gunnels with visitors in summer.  Easily affordable houses here still.  What’s not to like.

More new businesses have sprung up since we had our Chester home, including an award winning natural food enterprise set up by clients of ours I introduced to these parts.  The head office of Haskapa overlooks the Bay and supplies their healthy produce all over Canada.  Japan next I hear.  Do google it and be amazed.  What you feel being in Mahone Bay is summed up by the quote prominently displayed in front of the excellent Scots Whisky selection in the local pub, The Mug and Anchor... “Why Limit Happy to an Hour?”  I’ll drink to that!

It’s been good to get away from it all.  All the gloom over Brexit, or Wrexit as our politicians seem to be determined to do.  Not much hype here about the World Cup either.  I was asked by an otherwise intelligent chap why England were so adapt at “kick-ins” and as the England v Colombia game got closer to a 90 minute stalemate when the “try-again match” was to take place.  And it’s good to get away from all the dismal stock market predictions.  They do have TV news and newspapers here but they’re obsessed by local issues like baseball and American football results and other mysteries.

I brought 3 books with me and I’ve a Kindle App on the iPad.  Funnily enough, thinking of Judi Dench and “The Shipping News” one is “Attention All Shipping” by Charlie Connelly which is a journey round that British radio institution the Shipping Forecast.  So if you recognise “Viking, North Utsire and South Utsire” and fancy learning about Captain Cook and what Charlie got up to in places like Arbroath do read it.

My other books are a biography of Edinburgh born Sir John Cowperthwaite who helped Hong Kong grow from a down-and-out post WW2 economic wreck to its position today with per capita wealth 40% higher than the UKs, by applying economic policies he gleaned from studying the works of Kirkcaldy born Adam Smith, and “Parallel Thinking” by Edward de Bono which postulates how instead of “fixing” problems we should change to “what could we do that’s totally new” thinking.  Blue sky thinking I think it’s called.

Makes my brain hurt but it helps challenge what are accepted as “facts” as relayed by news channels. And that’s where my iPad comes in handy.  I can access, thanks to wifi and 4G, (Blue sky inventions), my favourite sites that I can rely on for the real facts on market probabilities.  While Morgan Stanley and others give repeated erroneous recession warnings, the detailed research findings of the likes of Ned Davis, Scott Grannis, Mike Williams and Prof Jeff Miller are those to be relied upon.  And no recession do they see yet.

Ned himself, a cautious chap at the best of times, still sees reasons for optimism for investors in 3 key indicators.  And if you want to check what Jeff Miller is saying you can follow him free on Dash of Insight.  You might get a big surprise if you have a look at this week’s issue!

So the message so far on this trip in the Maritimes is that no recession storms are brewing so no need for the oxygen and clean underwear just yet!

alan-steel
Author
Alan Steel
Chairman
This letter is the personal view of Alan Steel. Please check the appropriateness to your individual position with your advisor before taking or refraining from any action.

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